US flood insurance at 50 years: is the public–private partnership working?

In the United States, the national framework to address flood risk is the 50-year-old National Flood Insurance Program where the government bears the risk and private insurers handle customer policies. The program bundles insurance with flood mapping, floodplain management, and mitigation in the Federal Emergency Management Agency. Despite financial shortfalls and political controversy, evidence shows that public support is sufficient to continue and reform the program. Originally intended to transfer risk from taxpayers to insurance, the program recently required a taxpayer bailout after major hurricane-induced flood losses. Affordability of premiums is a major financial concern, even while premiums are forecast to rise. The flood mapping program is key to risk assessment, but it needs much improvement. The risk pool depends on compliance with floodplain resilience controls, which work better in riverine environments than in coastal zones. There is evidence of increased private sector interest in offering flood insurance. Politics raise questions about whether the needed reforms will succeed, but promising initiatives are to base premiums on risk, emphasize improvements in flood mapping, increase the involvement of private insurers in flood insurance, and increase responsibility of the state and local governments in flood risk resilience.